TORONTO--(BUSINESS WIRE)--Canada Goose Holdings Inc. (“Canada Goose” or the “Company”) (NYSE:GOOS,
TSX:GOOS) today announced financial results for its first quarter ended
June 30, 2018. The Company’s Management’s Discussion and Analysis and
Unaudited Condensed Consolidated Interim Financial Statements for the
three month period ended June 30, 2018 will be filed on SEDAR at www.sedar.com,
the EDGAR section of the U.S. Securities and Exchange Commission website
at www.sec.gov
and posted on the Company’s website at investor.canadagoose.com.

“Our strong start to the year, in our smallest fiscal quarter, is a
great leading indicator. Our products and our brand continue to resonate
with people around the world, and our direct-to-consumer channel was a
standout performer in the quarter. Productivity across our retail store
network in this off-peak period was exceptional, reducing the loss
impact of our strategic growth investments and giving us a favorable
tailwind for the rest of the year,” stated Dani Reiss, President & Chief
Executive Officer.

Direct-to-consumer (“DTC”) revenue increased to $23.2m from $8.3m. The
increase was primarily due to the strong performance of all existing
and new retail stores, with particularly significant contributions
from well-established locations. E-commerce also had a positive impact
on the quarter.

Wholesale revenue increased to $21.5m from $19.9m, driven by higher
order volumes from existing retail partners.

Gross profit increased to $28.6m, a gross margin of 64.0%, compared to
$13.2m, a gross margin of 46.8%. The increase in gross margin was
attributable to a greater proportion of DTC revenue and to a lesser
degree, wholesale gross margin expansion.

DTC gross profit was $17.7m, a gross margin of 76.3%, compared to
$6.2m, a gross margin of 74.7%. The increase in gross margin was
primarily driven by product mix and partially offset by unfavorable
foreign exchange fluctuations.

Wholesale gross profit was $10.9m, a gross margin of 50.7%, compared
to $7.0m, a gross margin of 35.2%. The increase in gross margin was
primarily attributable to a different wholesale mix in the quarter
compared to the same quarter last year. Favorable foreign exchange
fluctuations between the purchase of raw materials and the sale of
product also contributed to lower unit costs, and inventory provision
movements were lower in the current period.

Operating loss was $(19.9)m, compared to a loss of $(14.8)m. The
increase in operating loss was driven by higher unallocated corporate
expenses in a seasonally small quarter, partially offset by larger
operating income contributions from both channels.

Unallocated corporate expenses were $25.9m, compared to $13.4m. The
increase was due to SG&A growth investments including marketing,
corporate headcount and IT, as well as higher professional fees and
other costs relating to public company compliance.

Unallocated depreciation and amortization was $3.4m, compared to
$2.2m, driven by the retail store opening program.

DTC operating income was $6.5m, an operating margin of 28.0%, compared
to an operating loss of $(0.3)m. The shift to a positive operating
margin was driven by strong retail store productivity, as well as
channel gross margin expansion and a lower level of pre-opening costs.

Wholesale operating income was $2.9m, an operating margin of 13.5%,
compared to $1.1m, an operating margin of 5.5%. The increase in
operating margin was driven by an increase in channel gross margin,
partially offset by higher channel SG&A as a percentage of sales, due
to additions to headcount and costs for sales and operations support.

Net loss was $(18.7)m, or $(0.17) per basic and diluted share,
compared to a net loss of $(12.1)m, or $(0.11) per basic and diluted
share.

Adjusted EBITDA(1) was $(13.5)m compared to $(13.6)m.

Adjusted net loss(1) was $(17.1)m, or $(0.16) per basic and
diluted share, compared to an adjusted net loss of $(13.3)m, or
$(0.12) per basic and diluted share.

(1) See “Note Regarding Non-IFRS Financial Measures”.

Fiscal 2019 Outlook

The Company reiterates the following outlook for fiscal 2019:

Annual revenue growth of at least 20%

Adjusted EBITDA margin expansion of at least 50 basis points

Annual growth in adjusted net income per diluted share of at least 25%

The fiscal 2019 outlook above and key assumptions underlying such
outlook were originally provided on June 15, 2018, in the press release
announcing the Company’s Results for Fiscal Year 2018 under the heading
“Fiscal 2019 and Long-Term Outlook”. Within the meaning of applicable
securities laws, this outlook constitutes forward-looking information.
Actual results could vary materially as a result of numerous factors,
including certain risk factors, many of which are beyond the Company’s
control. See “Cautionary Note Regarding Forward-Looking Statements”.

Conference Call Information

A conference call to discuss first quarter fiscal 2019 results is
scheduled for today, August 9, 2018, at 9:00 a.m. Eastern Time. Dani
Reiss, President and Chief Executive Officer and Jonathan Sinclair, EVP
and Chief Financial Officer, will host the conference call. Those
interested in participating in the call are invited to dial (844)
579-6824 or (763) 488-9145 if calling internationally. Please dial in
approximately 10 minutes prior to the start of the call and reference
Conference ID 8573118 when prompted. A live audio webcast of the
conference call will be available online at http://investor.canadagoose.com.

About Canada Goose

Founded in a small warehouse in Toronto, Canada in 1957, Canada Goose
has grown into one of the world’s leading makers of performance luxury
apparel. Every collection is informed by the rugged demands of the
Arctic and inspired by relentless innovation and uncompromised
craftsmanship. From Antarctic research facilities and the Canadian High
Arctic, to the streets of New York, London, Milan, Paris, and Tokyo,
people are proud to wear Canada Goose products. Employing more than
2,900 people worldwide, Canada Goose is a recognized leader for its Made
in Canada commitment, and is a long-time partner of Polar Bears
International. Visit canadagoose.com for more information.

Non-IFRS Financial Measures

This press release includes references to adjusted net loss, EBITDA,
adjusted EBITDA, adjusted EBITDA margin, and adjusted net loss per basic
and diluted share. The Company presents these measures because its
management uses these as supplemental measures in assessing its
operating performance, and believes they are helpful to investors,
securities analysts and other interested parties, in evaluating the
Company’s performance. The measures referenced above are not
measurements of financial performance under IFRS and they should not be
considered as alternatives to measures of performance derived in
accordance with IFRS. In addition, these measures should not be
construed as an inference that the Company’s future results will be
unaffected by unusual or non-recurring items. These measures have
limitations as analytical tools, and you should not consider such
measures either in isolation or as substitutes for analyzing the
Company’s results as reported under IFRS. The Company’s definitions and
calculations of these measures are not necessarily comparable to other
similarly titled measures used by other companies. These non-IFRS
financial measures are defined and reconciled to the most comparable
IFRS measures in the tables at the end of this press release.

A reconciliation of projected adjusted EBITDA and adjusted net income,
which are forward-looking measures that are not prepared in accordance
with IFRS, to the most directly comparable IFRS financial measures, is
not provided because we are unable to provide such reconciliation
without unreasonable effort. The inability to provide a quantitative
reconciliation is due to the uncertainty and inherent difficulty
predicting the occurrence, the financial impact and the periods in which
the components of the applicable IFRS measures and non-IFRS adjustments
may be recognized. The IFRS measures may include the impact of such
items as non-cash share-based compensation, revaluation of the carrying
value of our indebtedness, amortization of intangible assets and the tax
effect of such items, in addition to other items we have historically
excluded from adjusted EBITDA and adjusted net income. We expect to
continue to exclude these items in future disclosures of these non-IFRS
measures and may also exclude other similar items that may arise in the
future (collectively, “non-IFRS adjustments”). The decisions and events
that typically lead to the recognition of non-IFRS adjustments are
inherently unpredictable as to if or when they may occur. As such, for
our fiscal 2019 outlook, we have not included estimates for these items
and are unable to address the probable significance of the unavailable
information, which could be material to future results.

Cautionary Note Regarding Forward-Looking Statements

The foregoing financial information as at and for the three months ended
June 30, 2018 are unaudited and subject to quarter-end and year-end
adjustments in connection with the completion of our customary financial
closing procedures. Such changes could be material.

This press release includes forward-looking statements. These
forward-looking statements generally can be identified by the use of
words such as “anticipate,” “expect,” “plan,” “could,” “may,” “will,”
“believe,” “estimate,” “forecast,” “goal,” “project,” and other words of
similar meaning. Each forward-looking statement contained in this press
release is subject to risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by such
statement. Applicable risks and uncertainties include, among others, our
expectations regarding industry trends, our business plan and growth
strategies, our expectations regarding seasonal trends, our ability to
implement our growth strategies, our ability to keep pace with changing
consumer preferences, our ability to maintain the strength of our brand
and protect our intellectual property, as well as the risks identified
under the heading “Risk Factors” in our Annual Report on Form 20-F for
the fiscal year ended March 31, 2018, and filed with the Securities and
Exchange Commission (“SEC”), and the securities commissions or similar
securities regulatory authorities in each of the provinces and
territories of Canada (“Canadian securities regulatory authorities”), as
well as the other information we file with the SEC and Canadian
securities regulatory authorities. We caution investors not to rely on
the forward-looking statements contained in this press release when
making an investment decision in our securities. You are encouraged to
read our filings with the SEC, available at www.sec.gov,
and our filings with Canadian securities regulatory authorities
available at www.sedar.com
for a discussion of these and other risks and uncertainties. The
forward-looking statements in this press release speak only as of the
date of this release, and we undertake no obligation to update or revise
any of these statements. Our business is subject to substantial risks
and uncertainties, including those referenced above. Investors,
potential investors, and others should give careful consideration to
these risks and uncertainties.

(1) , Adjusted net loss,adjusted net loss per basic and diluted
share, EBITDA, and adjusted EBITDA are non-IFRS financial measures.See
— “Reconciliation of Non-IFRS Financial Measures” for a
description of these measures and a reconciliation to the nearest IFRS
measure.

Condensed Consolidated Interim Statements of Financial Position

(unaudited)

As at June 30, 2018 and 2017 and March 31, 2018

(in millions of Canadian dollars)

June 30

June 30

March 31

2018

2017

2018

Assets

$

$

$

Current assets

Cash

14.6

13.1

95.3

Trade receivables

12.4

8.5

11.9

Inventories

239.5

177.0

165.4

Income taxes receivable

8.0

5.6

5.1

Other current assets

32.4

12.4

23.3

Total current assets

306.9

216.6

301.0

Deferred income taxes

10.5

10.1

3.0

Property, plant and equipment

64.2

40.4

60.2

Intangible assets

140.1

131.7

136.8

Other long-term assets

4.5

-

2.1

Goodwill

45.3

45.3

45.3

Total assets

571.5

444.1

548.4

Liabilities

Current liabilities

Accounts payable and accrued liabilities

90.0

47.4

109.6

Provisions

4.3

4.7

6.3

Income taxes payable

0.3

-

17.7

Total current liabilities

94.6

52.1

133.6

Provisions

10.5

9.4

10.8

Deferred income taxes

12.5

11.2

13.3

Revolving facility

76.9

97.3

-

Term loan

140.4

136.6

137.1

Other long-term liabilities

10.8

3.1

10.0

Total liabilities

345.7

309.7

304.8

Shareholders' equity

225.8

134.4

243.6

Total liabilities and shareholders' equity

571.5

444.1

548.4

Condensed Consolidated Interim Statements of Cash Flows

(unaudited)

For the three months ended June 30

(in millions of Canadian dollars)

2018

2017

$

$

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss

(18.7

)

(12.1

)

Items not affecting cash

Depreciation and amortization

4.4

3.1

Income tax recovery

(4.3

)

(5.8

)

Interest expense

3.0

3.0

Unrealized foreign exchange gain

(1.2

)

(3.3

)

Share-based compensation

0.4

0.2

(16.4

)

(14.9

)

Changes in non-cash operating items

(111.6

)

(61.3

)

Income taxes paid

(24.3

)

(1.3

)

Interest paid

(2.2

)

(2.5

)

Net cash used in operating activities

(154.5

)

(80.0

)

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property, plant and equipment

(2.1

)

(5.6

)

Investment in intangible assets

(2.8

)

(1.3

)

Business combination

-

(0.3

)

Net cash used in investing activities

(4.9

)

(7.2

)

CASH FLOWS FROM FINANCING ACTIVITIES:

Borrowings on revolving facility

78.5

90.5

Exercise of stock options

0.8

0.1

Net cash from financing activities

79.3

90.6

Effects of foreign currency exchange rate changes on cash

(0.6

)

-

(Decrease) increase in cash

(80.7

)

3.4

Cash, beginning of period

95.3

9.7

Cash, end of period

14.6

13.1

Reconciliation of Non-IFRS Measures

The tables below reconcile net income to EBITDA, adjusted EBITDA,
and adjusted net loss for the periods presented:

CAD $ millions

Three months ended

(unaudited)

June 30

2018

2017

Net loss

(18.7

)

(12.1

)

Add (deduct) the impact of:

Income tax recovery

(4.3

)

(5.8

)

Net interest and other finance costs

3.1

3.1

Depreciation and amortization

4.4

3.1

EBITDA

(15.5

)

(11.7

)

Add (deduct) the impact of:

Transaction costs (a)

1.2

1.3

Unrealized foreign exchange loss (gain) on Term Loan Facility (b)

0.4

(3.8

)

Share-based compensation (c)

0.2

0.1

Pre-store-opening costs (d)

0.2

0.5

Adjusted EBITDA

(13.5

)

(13.6

)

CAD $ millions

Three months ended

(unaudited)

June 30

2018

2017

Net loss

(18.7

)

(12.1

)

Add (deduct) the impact of:

Transaction costs (a)

1.2

1.3

Unrealized foreign exchange loss (gain) on Term Loan Facility (b)

0.4

(3.8

)

Share-based compensation (c)

0.2

0.1

Pre-store-opening costs (d)

0.2

0.5

Amortization on intangible assets acquired by Bain Capital (e)

-

0.5

Total adjustments

2.0

(1.4

)

Tax effect of adjustments

(0.4

)

0.2

Adjusted net loss

(17.1

)

(13.3

)

(a)

In connection with the Secondary Offerings in June 2018 and July
2017, we incurred expenses related to professional fees, consulting,
legal, and accounting that would otherwise not have been incurred.
These fees are reflected in the table above, and do not reflect
expected future operating expenses after completion of these
activities.

(b)

Represents non-cash unrealized gains and losses on the translation
of the Term Loan Facility from USD to CAD, net of the effect of
derivative transactions entered into to hedge a portion of the
exposure to foreign currency exchange risk.

In connection with Bain Capital’s purchase of a 70% equity interest
in our business on December 9, 2013, we recognized an intangible
asset for customer lists in the amount of $8.7 million, which had a
useful life of four years and was fully amortized in the third
quarter of fiscal 2018.